Debenhams Prepares to Call in Administrators

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Westfield store among 142 which could now remain permanently closed

Debenhams is on the brink of collapse today, with the store chain filing a notice of intent to bring in administrators this morning, Monday 6 April.

The company's department stores, including the one on Westfield London in Shepherd's Bush, are already closed due to the coronavirus outbreak, but it is now uncertain whether they will reopen once current the lockdown is lifted.

The chain has 142 stores, altogether employing 22,000 staff.

This move attempts protect Debenhams assets from creditors during the coronavirus lockdown, giving it ten working days to secure a rescue deal.

In a statement it said: "This move will protect Debenhams from the threat of legal action that could have the effect of pushing the business into liquidation while its 142 UK stores remain closed in line with the government’s current advice regarding the Covid-19 pandemic.

"The group is making preparations to resume trading its stores once government restrictions are lifted."

In April last year, the Westfield store appeared to escape the axe when it was not included on a list of 22 closures announced by the struggling chain, and it looked set to stay open until at least the end of this year.

A second chain with a store at Westfield, floral fashion specialist Cath Kidston has also confirmed that it intends to appoint advisory firm Alvarez & Marsal as administrators.

A spokesperson said it was part of an ongoing process to explore all options for the company which was in the middle of a turnaround plan before the global Covid-19 pandemic hit.

Cath Kidston employs 941 people, of which 820, including staff at its Westfield store, have been furloughed under the government's employee payment scheme.

Both chains said that despite the situation, they are continuing to trade online.

The Debenhams statement said: " While our stores remain closed in line with government guidance, and the majority of our store-facing colleagues have been furloughed, our website continues to trade and we are accepting customer orders, gift cards and returns."

April 6, 2020